Loan Payment Calculator

The loan calculator allows you to easily and quickly calculate the payment schedule for the loan you are interested in, and assess your ability to repay the debt without delay. Enter several loan parameters, select the conditions that are convenient for you and compare them with offers from different banks.

• How to use a loan payment calculator?
• Loan payment formulas

How to use a loan payment calculator?

To use our calculator, fill in the fields and click the 'Calculate' button, in addition, by clicking the 'Advanced settings' button, you can change the frequency of accrual, add an initial payment, and also set periodic surcharges. You can see the calculation result on the right side of the calculator, and by clicking 'View report' you will see the loan repayment table.

Loan payment formulas

Before we go any further, it's important to discuss a few specific terms and conditions that you may encounter when considering a loan. You can read these phrases below to better understand the concept of credit.

• Loan amount: is the amount of money (also known as a principal) that a bank (or any other financial institution) lends or, conversely, borrows from an individual. In other words, this is the amount that the borrower undertakes to repay to the lender at maturity, not including interest.
• Interest: is the annual interest rate (also called the nominal rate or quoted rate) set by banks (or other parties). It is also important to consider the expected rate of inflation when checking the quoted rate: the higher the rate of inflation, the lower the real interest rate; thus, the real burden created by the interest rate is reduced.
• Term: this refers to the time frame the loan will last if you make only the required minimum payments each month. For example, a 20-year fixed-rate mortgage has a term of 20 years. Auto loans are often issued for 5 or 6 years.
• Periodic interest rate: the rate of interest charged by the lender or paid by the borrower in each payment period. It can be annual, semi-annual, quarterly, monthly, daily, or any other time interval. For example, a bank may charge 2% per month on credit card loans or 1% quarterly on loans. Divide the annual rate by the number of payments per year to get the periodic interest rate. For example, in the case of a monthly payment with an annual rate of 6%, the periodic interest rate is 6% / 12 = 0.5%.
• Loan payment: the amount of money that the borrower must repay in each payment period. In most cases, borrowed funds are returned in installments (installments) on the loan in equal installments during the payment period.
• Loan Payment Schedule/Repayment Schedule: Each loan payment consists of two parts: the interest part and the principal repayment part. The percentage of interest is higher at the beginning of the loan term, but decreases as the balance of the loan decrease, in other words, the more the loan is repaid, the higher the share of principal in installments.

With a quick grasp of financial terminology, we can build the loan payment formula used in our loan calculator.PP = \dfrac{A}{\Bigg( \dfrac{(1+PR)^n-1}{PR(1+PR)^n} \Bigg)}

• PP - periodic loan payment
• A - credit amount
• PR - periodic interest rate
• n - number of payments